Ethan Brown, founder and CEO of Beyond Meat Photo: Courtesy of Beyond Meat

Beyond Meat, one of the US' largest producers of meat substitutes, announced on Tuesday that it will set up production facilities for plant-based meat in China, a move that analysts said reflects the difficulty of business decoupling between China and the US, even though relations between the world's two largest economies are souring.

Beyond Meat (Jiaxing) Food Co, a subsidiary of the company, signed a deal with the Jiaxing Economic and Technological Development Zone (JXEDZ) in Jiaxing, East China's Zhejiang Province, to develop manufacturing facilities that will produce plant-based meat substitutes including "beef, pork and chicken", according to a statement that Beyond Meat sent to the Global Times on Tuesday.

"Beyond Meat will be the first multinational company focused solely on plant-based meat production to bring its own major production facility into China," the statement said. 

Trial production is expected to begin within months and the facility will reach full operation in early 2021, said the company.

"China is one of the world's largest markets for animal-based meat products, and potentially for meat substitutes," said Ethan Brown, CEO and founder of Beyond Meat.

"We are delighted and confident that after several months of productive and collaborative discussions, we will partner with the JXEDZ to develop two production facilities, including one of the world's largest and technologically advanced plant-based meat factories," Brown noted.

Zhu Danpeng, a veteran food industry analyst, told the Global Times on Tuesday that transnational firms are voting with their feet despite external political pressure.

"Foreign companies cannot miss out on the huge consumption market of China and more importantly, the nation's business activity has emerged from the impact of the pandemic. Those firms badly need such a market to be the driving force of their business growth," said Zhu.

In April, US coffee giant Starbucks updated its menu featuring plant-based meat substitutes from Beyond Meat, marking the company's official entry into the Chinese market, where such food products are still a novelty.

Plant-based meat products are being supported by favorable policies, strong capital investment, and a bright industry outlook. There is a high threshold to enter the sector, which means it will bring good profits, he noted.

"But that is not enough - the consumption side is the key," said Zhu, adding that consumers' concerns over the health and safety of the products should be addressed.

Shares of Beyond Meat rose 2.6 percent in pre-market trading on Tuesday on the US NASDAQ board.